Exploring Decision-Making Techniques: How Do You Choose the Best Path Forward?

Hi all,

Please read about various decision-making techniques in detail.

Pareto Analysis

*Selecting the Most Important Changes To Make*

Pareto analysis is a very simple technique that helps you choose the most effective changes to make. It uses the Pareto principle - the idea that by doing 20% of the work, you can generate 80% of the advantage of doing the entire job. Pareto analysis is a formal technique for finding the changes that will provide the biggest benefits. It is useful when many possible courses of action are competing for your attention.

To start using the tool, write out a list of the changes you could make. If you have a long list, group it into related changes. Then score the items or groups based on the specific problem you are trying to solve. The first change to tackle is the one with the highest score, as it will give you the biggest benefit if solved.

Example:

A manager takes over a failing service center and receives feedback from customers. By grouping and scoring the issues, the manager can identify that improving staff skills can solve the majority of problems.

Key points:

Pareto analysis is a simple technique to identify the most important problem to solve. List the problems, group related ones, assign scores, and work on the group with the highest score.

Paired Comparison Analysis

*Working Out the Relative Importance of Different Options*

Paired Comparison Analysis helps you determine the importance of options relative to each other, especially when objective data is lacking. It assists in setting priorities when there are conflicting demands on your resources.

To use the technique, list your options and create a grid for comparison. Compare each option with every other option, assigning scores to show the difference in importance. Consolidate these comparisons to assign a percentage importance to each option.

Key points:

Paired Comparison Analysis is useful for weighing up the relative importance of different options. It provides a framework for comparing options and showing the difference in importance between factors.

Grid Analysis

*Making a Choice Where Many Factors Must be Balanced*

Grid Analysis is effective for decision-making when you have multiple good alternatives and many factors to consider. List your options and important factors in a table, assign relative importance values to the factors, and score each option for each factor. Multiply the scores by the importance values and add them up to determine the best option.

Key points:

Grid Analysis assists in deciding between options while considering various factors. Lay out options and factors in a table, score each choice for each factor, and weigh the scores by the importance of the factor to make the decision.

Continued...

Hi,

I had gone through these techniques in the Six Sigma training. Adding to what you have said:

1. We should ensure that we do not have a solution and to find it we need to go through some analysis. For example, if you have statistics to tell you that your output is consistently prone to errors and if you know that you have not followed the process, it is good to start following the process than to spend time in knowing the cause.

2. Basis of measurement: The criteria and the instrument for measurement should be unbiased. If not, the results might not lead you to the right solution.

3. Intention to solve the problem: Above all, there should be a true intention to solve the problem and efforts have to be put into solving it.

When faced with problems, I was able to find the solutions even before I could go in for analysis. Something to do with brainstorming and genuine intention and keeping the people together?

Correct me if I am wrong.

Thanks,
Hema

Hema,

Your viewpoint is practical. I have come across a lot of senior management persons who preach all these, but in practice, less is done. I always believe that problems are opportunities.

Sivap

Hi Sivap,

I know it is very tough, and this is where HR should play a crucial role. If you analyze carefully, if these issues are not sorted out, you might end up with a wrong diagnosis of the problem and waste time in finding a solution to a problem that does not exist.

Let me share my experience with you:

On a particular account, one of the teams had a lot of escalations from the client's side, and the management decided to relook at the process. This was communicated to the concerned team manager.

The team manager immediately drew up excellent process charts and adherence checklists and also made the members act the same way when questions are asked. The quality team came in and verified all these checks and wondered how there could be lapses when the process is strongly adhered to.

The quality team decided to throw the ball into the client's court, and I finally stopped them and requested quality to observe without the knowledge of the team when the process is running the next time.

Surprisingly, the modus operandi was entirely different from what was documented, and this became a rude shock for them.

Finally, it was found out that the Team Manager is not a person who accepts mistakes and does not have any intentions to correct them. For him, the document is something to satisfy the ISO standards and not for operations.

Now, it is HR's responsibility to change the attitude of the person.

Imagine if quality had gone to the client with a different version, the company might have lost a valuable account.

Even to diagnose a problem, we need these base parameters. I know it is difficult, but that is human relations... is it not?

Useful stuff. I encountered some of these tools and a few others in quality improvement training and use them regularly at an individual and team level.